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Feature
A Waxing Empire
Elizabeth Harris
07/01/2006

Sam Johnson had a radical idea. The patriarch of the renowned Racine, Wis.-based business was the fourth-generation man to oversee the entire conglomerate, guiding the firm’s successful expansion for more than 40 years. But as he neared retirement in the 1990s, he formulated a plan to drastically alter this winning succession formula.

Upending the legacy begun by his great-grandfather Samuel Curtis (S.C.) Johnson when he founded the company in 1886, Johnson chose to divide control of the business’ operating companies among three of his children. A fourth would oversee the family foundation. Johnson may have been hoping to avoid the clashes that punctuated his upbringing: When his grandfather died in 1928 without a will, his father, Herbert Fisk Jr., wrestled with his sister for control of the firm for a decade.

In 2000, Sam Johnson become chairman emeritus of SC Johnson, the cleaning products company, clearing the way for his children to assume high-level management of the family businesses. Today, two years after his death, his legacy represents a case study of not only how a family can successfully plan for business succession, but also how one can transition a company from concentrated leadership to control by consensus.

TOP VIEW: For four generations, the Johnson family companies were led by a strong patriarch. Now the fifth generation is taking a more cooperative approach. However, one heir, Helen Johnson-Leipold, is emerging as the glue that holds together this new team. Late chairman Sam Johnson's progressive business succession plan seems to be working, but with few successful models to follow, the family faces immense challenges, both internally and within their various businesses. These will surely test Johnson-Leipold's abilities in years to come.
A prime mover in the Johnson family’s culture of collaboration is Helen Johnson-Leipold. At 49, she serves as chairman and CEO of Johnson Outdoors, chairman of Johnson Financial Group and is a director of the family’s two other enterprises, SC Johnson and JohnsonDiversey. She also heads the family office, helping manage her family’s estimated $7.5 billion in assets, and is pivotal in its charitable work as chairman of the Johnson Foundation and a trustee of the SC Johnson Fund.

The business press is always rife with family business blowups. But Johnson-Leipold and her family are committed to avoiding this fate. With so few successful models to follow, they are creating their own. “This is a very unusual family in terms of their ability to get along,” says François de Visscher, president of an eponymous family business consulting firm and a fourth-generation family firm shareholder.

Last May, Johnson-Leipold and her mother, Gene, accepted an award from the Northwestern University Kellogg School of Management for “special contributions to family business,” on behalf of the Johnsons. How does Johnson-Leipold explain their success? “As long as we keep in our heads what’s best for the companies and family, there’s no argument,” she says.

Sam Johnson planted the seeds of family business harmony long ago, knowing his children would inherit a company vastly different than the one he did. (His tenure saw revenues grow 40-fold.) He initially engaged all four children in the family’s charitable work through the Samuel C. Johnson Family Foundation (now headed by his daughter Winnie Johnson-Marquart) so they would learn how to make cooperative decisions. He created four separate companies and changed the corporate structure by introducing outside presidents or CEOs to run them together with family members, who were chairmen. He also formed the Family Business Council, comprised of his children, their mother and three advisors, to help guide and oversee all the companies. There is no chairman; decisions are made by consensus.

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Related Articles
» Separation Anxiety
» The Johnson Business History
» 100 Year Plan Part IV: Culture Shock
» Succession Success
» 100 Year Plan Part IV: Delegation and Diplomacy
 
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